Trump’s 50% tariffs are scheduled to take effect tomorrow, and the Big PMO will meet: Sources

According to persons acquainted with the situation, the Prime Minister’s Office will hold a high-level conference on August 26 to discuss ways to help Indian exporters who are affected by rising tariffs in the US. The Prime Minister’s Principal Secretary is anticipated to chair the meeting.

Washington doubled existing charges, increasing the cost burden on exporters by imposing a 50% duty on Indian goods entering the US market starting Wednesday.

To learn more about the effects of the current 25% levy, which businesses claim has already compressed margins and decreased competitiveness, the ministry of trade and industry has been speaking with exporters and export promotion organizations.

Instead of implementing broad, economy-wide policies, the policy choices being discussed include tailored support for certain industries.

Exporters had requested an Emergency Credit Line Guarantee Scheme (ECLGS), offering collateral-free working capital with government-backed risk cover, but officials believe sector-specific interventions could be more effective.

EXPORT-ORIENTED SECTORS IN FOCUS WITH SMALL FIRMS

Micro-firms have stated that sector-specific loan lines with collateral support are beneficial, according to an official. In an effort to alleviate cash constraints, cluster-based working capital funds are also being actively considered.

Given their susceptibility to external shocks, officials stated that safeguarding export-oriented units and small and medium-sized businesses (SMEs) remained a key component of the government’s plan.

As exporters get ready for the tariff hike, Tuesday’s conference is anticipated to finalize the details of India‘s reaction.

The government’s action follows mounting worries that the 50% US tax may further hurt Indian exporters’ profit margins, interfere with supply chains, and reduce competitiveness in important industries including leather and textiles, engineering products, and specialized chemicals.